Pakistan has tremendous potential to achieve far higher economic growth, says President ICCI
ICCI calls for lifting all restrictions on businesses to achieve higher economic growth
Islamabad: Achieving a GDP growth of around 4 percent in the first nine months of the current fiscal year from negative GDP growth of 0.47 percent last year seems to be a remarkable claim of the government for turning around the economy, however, the government should consider lifting all restrictions on businesses that would help in achieving further higher economic growth of the country. This was stressed by Sardar Yasir Ilyas Khan, President, and Islamabad Chamber of Commerce & Industry (ICCI).
He said that the supernatural duties on the import of goods, services, machinery and equipment of many sectors including tourism and healthcare were the major hurdles towards the growth and investment in new projects, therefore, the government should withdraw high import duties in the coming budget to facilitate the growth of tourism and other sectors. He said that the cost of lending is still very high in Pakistan, which is also a major hindrance in the better growth of investment and businesses and government should reduce policy interest rate to 3 percent. He said that the government should also reduce the utility charges in the next budget to bring down the input cost of businesses and make them more competitive in the international market.
The ICCI President said that Pakistan achieved best ever GDP growth of over 10 percent in the fiscal year 1953-54, but after that our economy could not repeat such performance as yet, which was unfortunate. He said that Pakistan has tremendous potential to achieve far higher economic growth and the only requirement was that the government should focus on formulating conducive and consistent economic policies in consultation with the business leaders to unleash the actual growth potential of various sectors of the economy. He said that the next budget is around the corner and the Finance Minister should consult Presidents of all major chambers of commerce & industry to get the input of the business community for finalizing a growth-oriented budget. He was of the view that constant liaison and regular interaction between the business community and the business-related government departments like finance, commerce, FBR etc. should be the way forward to achieve sustainable economic growth of Pakistan.
Sardar Yasir Ilyas Khan that the SMEs were the backbone of the economy as they have 40 percent share in the annual GDP and are making significant contribution towards exports, however, the Covid-19 pandemic related lockdowns and restrictions have badly affected the business of SMEs due to which many of them were facing great problems. He said that according to a survey conducted by SMEDA in collaboration with Asian Development Bank Institute and Asian Productivity Organization, over 81% SMEs reported lower sales revenue in first half of 2020, over 66% decrease in permanent employees, over 33% reduction in production, over 82% cash flow shortage and over 76 percent were expecting decrease in total sales revenue in 2020. He said that another survey of SMEDA showed that 59 percent of SMEs reported an increase in operating cost and 57 percent increase in raw material cost in the range of 10 to 30 %, which showed that SMEs were facing great challenges in doing business in Pakistan. Therefore, he urged that the government should come up with some special relief measures for the SMEs in the forthcoming budget so that these businesses could recover some of their losses and play a more effective role in the economic development of the country.